Is this feasible? Legal?

[rootsnall]

Hi,

After reading through the advices/experiences posted on the forum, I have now decided to trade under Ltd and have decided to try Nixon Williams - (seem to have good feedbacks.. will let you know my experience.)

I plan to use this Ltd company as my "pension" fund and intend to hold the profit in the company, reinvest them in assets like deposits etc. and take out the dividend later while I retired abroad (non-resident) so that I don't have to pay UK income tax.

However, I am not sure whether this is possible as the HMRC's site didn't give a clear answer... Any comments will be much appreciated.

Many Thanks

Your accountant is the person to ask and but I think you will gain very little if anything by leaving money in your company. I'm not certain how it all works out exactly under the current dividend and corporation tax regime but it didn't use to make sense to go that way. I'd be interested if it now does !? You will be paying tax on your Co profits and gaining tax credits when paying out dividends that are then used to offset your personal tax bill. If you keep the money in the Co you will not be utilising the tax credits.

[ctrlaltc]

Thanks for your reply.. Talked to NW briefly, but they said they are not familiar with this type of international tax issues..

[DaveB]

NW shoulsd be able to tell you in detail but I believe the most efficient way of doing it is to take minimal salary + dividends up to your annual tax allowance and leave the rest in the company, then after 2 years close the company and take the money under taper relief which is at 10% I think.

This assumes that you have no other income using up your tax allowance. If you have then just leaving it in the co. as you plan is probably the best way and should be perfectly legal.

[ctrlaltc]

Hi,

After reading through the advices/experiences posted on the forum, I have now decided to trade under Ltd and have decided to try Nixon Williams - (seem to have good feedbacks.. will let you know my experience.)

I plan to use this Ltd company as my "pension" fund and intend to hold the profit in the company, reinvest them in assets like deposits etc. and take out the dividend later while I retired abroad (non-resident) so that I don't have to pay UK income tax.

However, I am not sure whether this is possible as the HMRC's site didn't give a clear answer... Any comments will be much appreciated.

Many Thanks